New Delhi, Oct 3 (KNN) Additional Secretary & Development Commissioner (AS&DC), Ministry of MSME, Ram Mohan Mishra urged the banks to collaborate in handholding and increasing credit flow by identifying potential Micro Small and Medium Enterprises (MSME) clusters for financing the units located therein.

The request was made during the 24th Meeting of the Standing Advisory Committee to review the flow of institutional credit to MSME Sector.

During the meeting, he highlighted the initiatives taken by Ministry of MSME for revival of the sector and explained in detail about Enterprise Development Centres (EDCs).

He also mentioned about the re-launch of Credit Linked Capital Subsidy Scheme (CLCSS) and Market Access Scheme and requested banks/Industry associations to create awareness about the same amongst the MSME borrowers.

Further, he informed the house that credit guarantee scheme of CGTMSE had been extended to Urban Co-operative banks also.

On TReDS, he said that there was not much traction on the platform as the number of buyers on-boarded was still low and there was a need to incentivize them for registering on the TReDS platform. With regard to the priority sector credit, he requested RBI to ascertain whether such credit was reaching to the intended beneficiaries.

During the review meeting, representatives of Industry Associations informed that bank guarantees were being issued for minimum one year, banks continue to levy RTGS / NEFT charges in violation of RBI guidelines, operative accounts was being freezed by banks due to delay in submission of KYC documents, etc.

In this regard, banks responded that in terms of IBA circular dated December 5, 2018, they are issuing guarantee for minimum period of one year, branches have been advised not to charge for RTGS / NEFT, and operative accounts were frozen for non-submission of KYC documents after serving 2-3 notices to the account holder.

As part of Agenda, a presentation was made on review of credit flow to MSMEs as on March 31, 2019 vis-a-vis previous years. The review covered outstanding credit to MSMEs, achievement of targets for MSEs recommended under ‘Prime Minister’s task force on MSMEs’ and cases resolved under framework for revival and rehabilitation of MSMEs.

Published On : 03-10-2019

Source : KNN India